Gemini Crypto Exchange Sees 52% Revenue Growth in Q3, Despite Share Price Slump
Gemini Space Station, the crypto exchange founded by the Winklevoss twins, has reported a 52% increase in revenue in the third quarter, reaching nearly $50 million. However, the company also posted a net loss of $159.5 million, which translates to a loss of $6.67 per share. This exceeds the expected loss of $3.24 per share predicted by analysts, according to a Bloomberg survey.
The company’s strong revenue growth can be attributed to the increase in transaction revenue, which rose 26% quarter-on-quarter to $26.3 million. This growth is largely due to the exchange’s new features and expansion into new markets. Additionally, Gemini’s services revenue saw a 111% increase to $19.9 million, reflecting the company’s diversification of its business mix and growing contributions from credit card, staking, and custody products.
Gemini’s credit card has also seen significant growth, with over 100,000 open accounts and quarterly transaction volume exceeding $350 million, more than doubling quarter-over-quarter. The company has also launched a self-custody wallet, aiming to streamline user access to Web3 protocols, DeFi platforms, and on-chain applications.
Drivers of Strong Revenue Growth
The increase in revenue can be attributed to the company’s expansion into new markets and the introduction of new features. The growth in services revenue reflects the company’s efforts to diversify its business mix and increase contributions from credit card, staking, and custody products. Gemini’s president and co-founder, Cameron Winklevoss, stated that the company’s credit card delivered record performance, exceeding expectations.
Gemini Sees Mounting Losses
Despite the strong revenue growth, Gemini posted a net loss of $159.5 million, largely due to stock-based compensation and the September IPO. The company’s operating costs more than doubled compared to the same period last year, resulting in an adjusted EBITDA of negative $52.4 million. The COO, Marshall Beard, stated that the company expects spending levels in the coming quarters to depend on the performance opportunities seen in the market.
The share price of Gemini (GEMI) fell as much as 12% in after-hours trading following the announcement, reaching an all-time low of under $15, according to Google Finance data. For more information, visit https://cryptonews.com/news/gemini-crypto-exchange-q3-revenue-jumps-52-despite-share-slump/
